Proposals for a new occupational pensions law have been released in Norway and are currently under discussion in parliament before expected ratification at the end of spring.
According to Ola Todal Janssen, adviser to the tax law department at the Norwegian Ministry of Finance, one of several main points is stricter linearity for premium payments made by companies to insurance companies and pension providers to cover liabilities.
“These must now include all wage increases made during the year, whereas previously companies had the possibility to postpone extra payments until the following year.
“Another significant proposal is that if a company’s premium fund reaches a level equivalent to 10 times the yearly premium payments, then the surplus has to be allocated back to the company,” Janssen says.
Companies can also ask for money back if the level is five times the annual amount, he adds.
Norwegian pensioners are also in line for higher retirement payments should a company’s pensions surplus garner more than four per cent investment returns, under rules to make the excess reserves payable to existing retirees.
And new employees will also enjoy greater pension rights if the law gets the green light, being immediately accepted as pension scheme members from the age of 20 and eligible for pension rights after a year of employment with a company has elapsed.
Published at the beginning of April, the proposals run to around 500 pages, and a final parliament decision is to be taken in June.
Anne Grete Steinkje, consultant at Norwegian advisors Pensjons and Finans, says: “There is a mountain of detail in the law, and I think it is just too much to take in.
“I believe this could make things very complicated for the future - the good points are so difficult to locate because of the sheer volume of proposals.”
A working group has also been set up by the Ministry of Finance, headed by Professor Selwig of the University of Oslo - also responsible for the proposed pensions law - to start looking at the question of DC provision in Norway.
Following a preliminary meeting in April the group will work through the summer before presenting its conclusions to the government in September. Hugh Wheelan